To Pay or Not To Pay: Staff Training and Professional Development

To Pay or Not To Pay: Staff Training and Professional Development

Before offering to send a staff member, or agreeing to a staff request, to attend training or a conference, you should always consider your practice’s ability to cover such costs, the benefit it will provide the practice, and the potential risk of losing the employee if they attend but equally, the risk they leave if you do not agree.

Professional development of staff in a private medical practice is an important means of keeping your business up-to-date and improving productivity. It is also a way for staff members to develop their skills and increase their engagement in their workplace and the industry.

The benefits of training are clear, but there are costs involved including in some instances, travel and accommodation. Therefore, employers often worry about the frustrating result of an employee resigning soon after undertaking an external training course. Therefore, many ask the question of what can be done in these circumstances? Is it possible to reclaim the costs of the training/travel from the employee if they resign soon after completing it?

The Fair Work Commission and Federal Court decisions make it clear that it is very unlikely that training-related costs can be recovered when an employee resigns or is terminated.

The Fair Work Act 2009 (Cth) allows an employer to make deductions from amounts paid to employees in very limited circumstances. One of the conditions relevant to private practices would be whether a deduction is authorised by or under a modern award or a Fair Work Commission order. Under the Health Professional and Support Services Award 2020 (HPSSA 2020) and the Nurses Award 2020 there is no provision for deductions on termination for training and travel costs paid in relation to the employee. A deduction may be authorised in writing by the employee where the payment has been made for something that is principally for the employee’s benefit. While training does benefit the employee, it simultaneously benefits the employer, and therefore does not meet this test.

A recent Federal Court decision looked at whether the employer was legally allowed to deduct money from the employee’s final pay for training costs. The training costs were taken from the employee based on a signed agreement between the employer and employee that specified the training cost would be deducted if employment was terminated within two years after the completion of the course. The question asked by the court was whether the training was for the employee’s benefit as required under the Fair Work Act. It was ultimately concluded that while the employer had stated that the course was ‘not compulsory’, it was of benefit to the employer’s business. Therefore, it was decided that the employer had no legal right to deduct the training costs from the employee’s final pay.

In contrast, costs that have been determined to be principally for an employee’s benefit include health insurance, loan repayments and personal use items paid for using a corporate card. That said, this is no absolute.

For example, a laptop that was being used for personal use alongside work use was found to be primarily for the employer’s benefit and was not a permitted deduction from an employee’s pay.

How does this affect your practice?

Before offering to send a staff member, or agreeing to a staff request, to attend training or a conference, you should always consider your practice’s ability to cover such costs, the benefit it will provide the practice, and the potential risk of losing the employee if they attend but equally, the risk they leave if you do not agree.

Remember, there is no obligation on the employer to pay for training opportunities and conferences (and related travel expenses) that are requested by the employee.

Employees are welcome to make suggestions, but it is the employer who will choose what training and conferences employees attend at the cost of the practice. Employees may choose to undertake study or education at their own expense. If they do so, it is advisable to be clear from the outset as to who is responsible for the costs.

If an employer instructs or approves its employees to attend a training course or a conference, the employer is expected to pay for it.

Under both the Nurses Award 2020 and the HPSSA 2020, such an employer is required to meet all reasonably incurred expenses in respect to fares, meals and accommodation where travel is required. Expectations of what is reasonable, and a travel allowance for fares, meals and accommodation should be set out prior to an employee’s travel.

If a practice wishes to give an employee travel and/or accommodation options that cost more than that approved as ‘reasonable’ by the practice, the practice may have a policy that permits the employee to make that choice on the basis the employee will have to pay for those costs over and above the reasonable costs approved by the practice.

Should you require advice and support regarding travel and training expenses at your practice, please contact the AMA (NSW) Workplace Relations team at workplace@amansw.com.au or on (02) 9439 8822.

Contributed by Dominique Egan, Anna Simpson and Jemima Tavener